DUBAI — Consumer prices in the UAE surged to a six-month high of 0.7 per cent on an annual basis in January and rose 0.3 per cent on the month due to an increase in housing prices, data from the National Bureau of Statistics showed on Sunday.
Analysts expect average inflation in the second largest Arab economy to grow to 2.4 per cent in 2012 after an estimated 1.6 per cent in 2011.
UAE Central Bank Governor Sultan Nasser Al Suweidi predicted that inflation could average around two per cent in 2012.
Showing the same trends, the monthly consumer prices inflation rate in Dubai dropped 0.94 per cent in January 2012 compared to December 2011, due to price drops in several segments. In 2011, inflation in Dubai slowed down to 0.52 per cent in 2011 compared to 2010 to hit its lowest level in four years.
Analysts believe that price rises would be under check following a decision taken by the UAE cabinet recently to liberalise the trade of 12 essential commodities in a move to end ‘monopoly and exploitation.’
DP World vice-chairman Jamal Majid bin Thaniah said at the recently held Dubai Economic Outlook session, with a projected inflation of 2.1 per cent in 2012, UAE’s gross domestic product would grow 3.8 per cent.
Analysts at Markaz said in 2012 inflation is expected to remain at a manageable 2.5 per cent.
Standard Chartered Bank predicted that UAE inflation “should average 1.6 per cent in 2012, compared with its two per cent forecast for 2011.